Neoliberalism: Socialism for the Rich, Capitalism for the Rest of Us

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White House budget chief Mick Mulvaney is directing federal agencies to identify “near term” and “long-term” staff cuts in line with the president’s proposed budget for next year. Don’t hold your breath. Mulvaney’s April 12 guidance, like the executive order from President Donald Trump that preceded it, is premised on the notion that the federal bureaucracy is like a kudzu vine that never stops growing. “Washington often crafts costly solutions in search of a problem,” Mulvaney wrote in the memo. “The result has been … too many federal employees stuck in a system that is not working for the American people.” But the federal bureaucracy is not growing. As of 2014, the last year for which data are available from the Office of Personnel Management, the civilian executive-branch workforce was 2.7 million workers. That’s slightly more than the workforce’s 2.5 million in 1962. The number of civilian executive-branch jobs remained stable, at 2.5 to 3 million, over the past half-century, even as the U.S. population — the customer base served by those 2.7 million workers — nearly doubled. Since 1962, total federal spending has increased from about $600 billion to about $4 trillion. How did that happen without ballooning the size of the federal workforce? By ballooning the size of the private-sector workforce to whom the federal government contracted out the work. Today more than half the Pentagon budget goes immediately out the door to federal contractors. “We maintain the most efficient cuts should take place with the enormous army of contractors,” said Alex Bastani, president of Local 12 of the American Federation of Government Employees, which represents about 3,000 Labor department career employees in Washington. But if the Trump administration proceeds with its planned cuts in the federal workforce, at least some of the work could be assigned to contract employees instead. That would likely increase rather than reduce costs associated with the programs being managed. According to a 2011 study by the nonprofit Project on Government Oversight, employees directly on the federal payroll were paid less than contract employees doing work for the federal government in 33 out of 35 occupational categories reviewed. If Mulvaney concentrates staff-cutting on the agencies that employ the most people, he’ll quickly encounter another problem: They’re the wrong people. The executive branch’s largest civilian workforce, according to the Bureau of Labor Statistics, is at the Department of Veterans Affairs–for which the Trump budget proposes a 6 percent increase. The next-largest, in turn, are in the Army, the Navy, the Department of Homeland Security, and the Air Force. The Trump budget proposes increases for all these, too. Indeed, more than half of the federal bureaucracy is defense-related, according to the Bureau of Labor Statistics—and that’s not counting uniformed military personnel. Mulvaney is directing federal agencies to reduce workforce in line with the White House budget, but that document is only a proposal placed before Congress–which has its own ideas about how to fund federal agencies. If agencies align personnel cuts too closely with measures called for in Trump’s budget—for instance, to eliminate a $2.4 billion Education Department program to improve teacher quality, or to close two regional offices of the Environmental Protection Agency by June 15—they would likely stir resistance from Congress. “Congress absolutely has the ability to prevent these cuts,” said Rep. Diana DeGette (D.- Colorado). “After all, we have the power of the purse.” Under the 1974 Impoundment Act, presidents may not decide on their own to withhold congressional appropriations. Then there are the mechanics of eliminating federal employees. To reduce staff in line with Trump’s proposed budget cuts, the agencies would likely have to go beyond attrition and the inducements of buyouts and early retirement offers to enact layoffs, known in the federal government as Reductions in Force. Under civil service rules, RIFs must accommodate seniority. A federal worker removed from a job has the right to displace another federal worker with less seniority and even to continue receiving for some period a former (higher) salary. The bumped worker in turn may displace a federal employee with even less seniority, and so on. “It’s a blunt instrument when you’re trying to put the best people in the best job,” said Edward L. Hunter, who worked 40 years at the Department of Health and Human Services and now is chief executive of the deBeaumont Foundation, a public health nonprofit. “It’s not a good formula for effective management of agencies.”The last time RIFs were used extensively was during the Reagan administration. “I was affected by two of them,” Hunter said, “but survived them.”Kim Hefling, Sarah Karlin-Smith and Ian Kullgren contributed to this report.